We don’t often comment on merger acquisitions in the United States, but some are global news. On Monday, Eldorado Resorts Inc acquired Caesars Entertainment and will merge with the company in a cash and stock deal. The deal will see Eldorado absorb the 58 global Caesars properties, including its World Series of Poker brand, and portfolio of casinos.
For some time now, there have been speculation of an imminent deal. The merger will subsequently result in the largest casino business in America.
Carl Icahn Gets What He Wants in Caesars Sale
If you have been following international gambling industry news at all over the last few years, you already knew that Caesars had been in financial trouble and even filed bankruptcy in 2015. The company has about $9 billion in debt as opposed to a valuation of just $7 billion.
Three months ago, famed investor Carl Icahn joined the board at Caesars. He has been pushing for a sale of the company ever since. A few weeks back, the board reportedly approved the sale of the company. An official announcement came on Monday.
Eldorado Resorts Aquisition
Under terms of the deal, Eldorado Resorts will buy the company in a stock and cash deal worth about $17.3 billion. This includes absorbing Caesars $9 billion in debt. Per the deal, Eldorado will pay $12.7 per share.
It will also take over approximately 58 properties from Caesars, mostly located in the United States. Eldorado has 26 properties in 12 US states and will instantly become the largest casino company in America.
Icahn spoke favourably of the deal after the announcement. He told NYTReports:
“It is rare that you see a merger where because of the great synergies ‘one plus one equals five. I look forward to seeing our investment prosper.”
Caesars CEO Tony Rodio spoke of the deal, stating:
“We believe this combination will build on the accomplishments and best-in-class operating practices of both companies. I’m familiar with Eldorado and its management team, having worked with them on a previous transaction, and I look forward to collaborating with them to bring our companies together.
Rodio added: “We are excited to integrate Caesars Rewards with the combined portfolio. The incorporation of Caesars Rewards has produced strong results at the recently acquired Centaur properties. By joining forces, we believe the new Caesars will be well-positioned to compete in our dynamic industry.”
Company to Be Headquartered in Reno, NV
Following the successful completion of the merger, the company will simply be known as “Caesars”. It will aslo be headquartered in Reno, NV, the current headquarters for Eldorado Resorts. In addition, the company intends to retain a “significant corporate presence in Las Vegas.
No mention was made regarding the status of the World Series of Poker brand or whether the new company would retain it. Eldorado is planning to use the Caesar name to capitalise on its popularity, though. Therefore, the company will likely keep the World Series of Poker brand.
For years, there have been speculation as to the future of the Rio All-Suite Hotel and Casino in Las Vegas. The property is the present home of the WSOP. Many have speculated that the Rio will be sold and the WSOP moved to the new Caesars Event Center to open in a couple of years.
It would seem that the sale of a struggling property and expansion of its global poker brand would thus be a wise move. Who knows, we may even see the new company decide to expand the WSOP outside of Las Vegas and Europe and possibly revive the WSOP Asia-Pacific.
We would love to see a WSOP Australia, even if it is just a WSOP Circuit event at the Crown Casino. While the future of the WSOP is uncertain at the moment, we know that Caesars will have a new life after its merger with Eldorado.